What is Credit Loan?
Credit loan is the loan offered by banks to their customers which they must pay back at a future due date. Credit loan include personal loans, mortgage loans, auto loans, students loans and lines of credit loan. It is also important that you understand Line of Credit Loan Agreement, which I will explain later in this article.
The interest rates for credit loan vary by lender and the borrower’s property can be seized by the lender if he defaults in the repayments of the loan.
Students loans are loans made available higher institution students and their families to help finance their education; mortgage loans are offered to customers who want to buy a new home or to renovate an existing home. However, the customer risk losing his home if he defaults in loan repayments.
Auto loans are offered for customers who want to buy a new car and also risking the car if they miss repayments. Personal loans are given to for personal use.
Credit loans can be secured with collateral or unsecured. Unsecured credit loan like personal loans tends to have higher interest rates than secured loans.
Line of Credit
Line of credit loan agreement is a form of credit arrangement between a bank or any financial institution and a customer, which allows the customer to borrow a certain amount of money.
The borrower withdraws from the amount provided by the lender but does not have to withdraw it all. The interest is paid only on the amount drawn and not on the full amount borrowed or the balance. If the amount drawn is paid back, the same amount or any amount can be drawn again. A line of credit loan agreement may be unsecured or secured with collateral.
Contrary to loans which are giving in one-time large sum, a line of credit loan agreement is taking in instalments. An amount is provided for the borrower but he van only draw a certain amount against the total amount provided and make repayments before he can draw against the line again.
How to Apply and Get Line of Credit
The first step to take in applying for line of credit is for the borrower to check his credit score as that is the most vital the lender will first consider. The credit score, among other things, show how the borrower handled previous debts and it determines the interest rate to be charged against the line of credit.
If the credit score is good, the interest rate will be lower and the borrowing limit will be higher and it is vice-versa if the credit score is bad. The lending institution will also consider the borrower’s income, job, bank statements among other necessary documents that will be required.
Some of the Credit Loan Companies
Getting a line of credit from a good company is not easy as always envisaged. It may be tedious to find a transparent lender with flexible terms and lower rates. Some of the credit loan companies are listed below:
1. Credit Loan
They give loan to people with good and bad credit. They have professional staff to handle customers’ issue.
They are one of the best credit loan companies in the US. They have 95% positive feedback from their customers.
They provide personal loans with flexible terms and interest rates.
ACCRT provide loans nationwide both long-term and short term. They people with bad credit score to rebuild their financial life and offer loans for bad credit.
They provide for personal loans bad credit borrowers. They are one of the leading credit loan companies in the US. Their loans come with competitive rates.